Consider this tale of two motorists should Gov. Robert F. McDonnell's new scheme to remake transportation taxes take hold.
Driver No. 1 has a heavy Hummer so ungainly that even the military is getting rid of it. The vehicle gets 10 miles per gallon, but thanks to proposed changes, he'll be able to drive farther and cheaper with no worries because he'll no longer have to pay the state's 17.5 cent per gallon gasoline tax.
Driver No. 2 has a new Chevrolet Volt. He can drive 380 miles on a full tank and a full electric charge. Because of McDonnell, he'll have to pay an extra $100 because it's an alternative car that supposedly doesn't pay its full share for using the state's roads, even though the gas tax that links road use to payment no longer would exist.
Such strange logic has experts shaking their heads. "Regressive" and "perverse" is how George Hoffer, a transportation economist at the University of Richmond, describes the idea. Adds Ronald Utt, a retired transportation analyst at the Heritage Foundation: "I am very skeptical of the plan and am frankly baffled by it."
The core of the plan undercuts what has been a long-accepted way of dealing with road taxes. The so-called user-fee system means that the more you use a road, the more you pay for it. So the more you drive, the more you pay the 17.5 cent per gallon tax, which hasn't been increased since 1986.
To make up for eliminating the gasoline tax — Virginia would be the first state to do so — McDonnell would raise state sales taxes from 5 percent to 5.8 percent. This means that people everywhere in the state would pay for roads whether or not they drive a car. The part of the existing sales tax that goes to transportation would increase by 0.25 cents over five years and vehicle registration fees would increase $15 to help pay for passenger rail and transit. The existing tax on diesel fuel would remain intact on the theory that trucks are responsible for most road wear and tear.
The additional sales tax and reallocation would raise nearly $500 million for roads within five years. Coupled with new registration fees and other money, Gov. McDonnell says the plan will generate $3.1 billion for roads by 2018.
Hoffer says the changes are regressive because lower-income people who may not own cars end up paying for road construction with every store purchase they make. Meanwhile, rural residents who pay the extra $15 in registration fees wind up paying for Amtrak and light rail systems that primarily serve urban areas such as Northern Virginia.
Meanwhile, others pay little or nothing at all. If you're a New Jersey resident passing through the Old Dominion on your way to Disney World, you don't have to pay for the privilege unless you buy something at a convenience store. "Why should we give out-of-staters a free ride?" Hoffer asks.
Utt says he's at a loss to explain how McDonnell came up with the idea. He says it serves the interests of some of the transportation lobbies, such as gas station operators and auto dealers. "The least powerful lobby is the motorist who uses the roads," he says.
The transportation plan also is void of other prominent items that McDonnell has proposed and used, including putting tolls on Interstate 95 near Emporia and using the state Public-Private Transportation Act to build new roads. "There's no discussion of it," Utt says.
There are other ways to eliminate the gas tax, which has been hamstrung by legislators' aversion to raising taxes and the fact that gasoline taxes generate less revenue as automakers crank out more fuel-efficient cars.
One high-tech substitute scheme called the Vehicle Miles Traveled Tax eliminates taxes at the gas pump and taxes motorists through an electronic device built into all vehicles. Based on Global Positioning System technology, the transmitter would record all miles driven and the motorist would be billed for them. Hoffer backs the system but says that critics worry it will raise privacy issues. "Those concerns are here anyway because you can be tracked through your cell phone," he says.
McDonnell is thinking outside of the box, Hoffer says. But the sheer zaniness of some of the ideas, such as penalizing owners of more fuel-efficient hybrids by making them pay the annual $100 fee simply makes no sense.
"It is just perverse," Hoffer says of forcing owners of combination electric- and gas-fueled cars to pay an extra $100. Such hybrids are lighter and create less wear and tear on roads, Hoffer says, and their owners will pay the sales tax anyhow.
"That's just stupid," Hoffer says. "If anything, they should be paying less." S